A look at countries that have experienced profound economic failure shows a convergence of forces creating an unrecoverable “debt spiral.” Huge fiscal deficits, ever-rising interest costs on a mushrooming national debt, and growth capital sucked from the private sector to finance public sector deficits – they all lead financial markets to conclude that a country’s central bank will either default on its debt or resort to printing money, causing catastrophic currency devaluation.

Who could have predicted that this Group of 20 meeting would see the chronically profligate Europeans counselling fiscal prudence, while the world’s traditional economic bedrock and issuer of the global reserve currency spends it way toward disaster? The euro zone crisis demonstrated that financial markets can lose confidence in the bonds and currency of sovereign states in a heartbeat. Remember that the combined deficits of borrowing states must be financed by private investors and countries that are running fiscal surpluses, such as China and Middle Eastern oil producers. A loss of confidence in U.S. federal and state bonds, and in the world’s reserve currency itself, could trigger an economic conflagration that would making the recent global financial crisis seem like a walk in the park.

The U.S. administration is playing an extremely high-risk game that could see Mr. Obama go down as the most damaging president in history. You don’t recover from alcoholism by taking another drink, and you don’t recover from a debt crisis with more debt. It’s past time that John Maynard Keynes’s long-discredited deficit spending theories be tucked back in his grave. Even if they are, it will take decades to repair the damage already done.